How Ohio's controversial abortion vote could be a blow for restaurants

Working Lunch: Proponents of killing the tip credit through referendum were spared a tougher fight.

Ohioans knew last week’s vote on changing the state’s ballot-initiative rules was really a referendum on abortion. What few understood was the impact the pro-choice victory could have on restaurants’ labor costs, according to this week’s episode of Working Lunch, the podcast that delves into government’s impact on the business.

Ohio voters were asked if they’d like to change the definition of victory for ballot initiatives, the proposals used by advocacy groups to enact laws without involving the state legislature. The one put before residents last week would have scuttled any referendum that failed to win yea’s from at least 60% of the participating voters, instead of the current 50%.

Anti-abortion forces had championed the proposal as a way of blocking pro-choice advocates from using the referendum process to make access to abortion a right expressly protected by the state constitution. Proponents of preserving access are expected to push for initiatives on the 2023 and ’24 ballots that call for amending the constitution.

But that higher margin of approval would have held for all ballot initiatives, not just any pertaining to abortion. And one of those is likely to be a call for raising Ohio’s minimum wage to $15 an hour and killing the state’s tip credit. 

With the needed margin of approval frozen at 50% for ballot initiatives, labor groups will have an easier time of hammering through the compensation changes than they would have if the 60% threshold had been adopted, said Mike Whatley, VP of state affairs and grassroots advocacy for the National Restaurant Association.

He explained to Working Lunch co-hosts Joe Kefauver and Franklin Coley that the industry has been shown the effects of disallowing the tip credit in Washington, D.C., the first jurisdiction in 21 years to drop the concession for employers of tipped workers. Since the credit was pared back in May, on its way to being totally eliminated within a few years, the District’s restaurant scene has been in a meltdown. It’s believed that a majority of full-service places there have adopted service fees as their way of weathering the bump in server and bartender pay, leaving guests, employees and restaurateurs in confounding chaos.

For a sense of what that situation might signal for Ohio, the nation’s fifth-largest restaurant state, download this week’s episode of Working Lunch from wherever you get your podcasts.

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